Deck 11: Feasibility Analysis and the System Proposal

Question 1

Feasibility is the measure of how beneficial or practical the development of an information system will be to an organization.

Answer 1

True

Question 2

Credibility is the measure of how beneficial or practical the development of an information system will be to an organization.

Answer 2

False

Question 3

Measuring feasibility throughout the life cycle of an information system is known as the creeping commitment approach to feasibility.

Answer 3

True

Question 4

The complexity of an apparently feasible project can change after the initial problems and opportunities are fully analyzed or after the system has been designed.

Question 5

The complexity of an apparently feasible project rarely, if ever, changes after the initial problems and opportunities are fully analyzed or after the system has been designed.

Question 6

At a feasibility checkpoint, a project may be canceled or revised at any checkpoint, despite whatever resources have been spent.

Question 7

Operational feasibility is a measure of how well a solution meets the identified system requirements.

Question 8

Cultural (or political) feasibility is a measure of how well the solution will be accepted in the organizational climate.

Question 9

Technical feasibility is a measure of how well a proposed system solves the problems and takes advantages of the opportunities envisioned for the system.

Question 10

Technical feasibility is a measure of the practicality of a technical solution.

Question 11

Schedule flexibility is a measure of how reasonable a project timetable is.

Question 12

Economic feasibility is a measure of the cost-effectiveness of a project or solution.

Question 13

Legal feasibility includes how well a solution can be implemented within existing contractual obligations.

Question 14

A yearly maintenance agreement on computer equipment is an example of a variable cost.

Question 15

The cost of printer paper is an example of a variable cost.

Question 16

A cost-benefit analysis that includes intangible benefits is often not acceptable.

Question 17

Some analysts dispute the existence of intangible benefits.

Question 18

The concept of the time value of money states that a dollar one year from now is worth more than a dollar today.

Question 19

In payback analysis the period of time that will elapse before accrued benefits overtake accrued costs is called the sunk costs period.

Question 20

In performing a payback analysis one needs to adjust costs and benefits for the time value of money.

Question 21

The higher the discount rate that is used in the calculation, the lower is the present value of a future dollar.

Question 22

Payback analyses done without adjusting for the time value of money tend to be overly optimistic and misleading.

Question 23

During the early phases of the project, judging the potential benefits of solving the problem is the priority since it is practically impossible to estimate costs.

Question 24

It is common for an information system to change the structure of how information is routed and controlled, changing the power structure of an organization.

Question 25

Where operational feasibility evaluates whether a system can work, cultural/political feasibility asks whether a system will work in a given organizational climate.

Question 26

Formal presentations are special meetings used to sell new ideas and gain approval for new systems. They may also be used for any of these purposes: sell a new system; sell new ideas; sell change; head off criticism; address concerns; verify conclusions; clarify facts; and report progress.

Question 27

A return-on-investment calculation computes a percentage.

Question 28

A net present value calculation computes a percentage.

Question 29

Net present value computes a dollar value.

Question 30

Technical feasibility looks at what is practical and reasonable. It addresses three major issues: (1) Is the proposed technology or solution practical? (2) Do we currently possess the necessary technology? (3) Do we possess the necessary technical expertise?

Question 31

Technical feasibility looks at the computer hardware, and considers the MIPS rate and data transfer rates as exclusive measures of technical feasibility.

Question 32

The learning curve for using technology can impact the technical feasibility of a project.

Question 33

Today, information systems development products are so easy to use, managers no longer need to consider the learning curve for using the technology as part of the technical feasibility for a project.

Question 34

The bottom line in many projects is economic feasibility.

Question 35

Studies suggest that sentences longer than 20 words are more persuasive.

Question 36

The costs associated with developing a system can be estimated from the outset of a project, and should be refined at the end of each phase of the project.

Question 37

The costs associated with developing a system cannot be estimated from the outset of a project but only at the end of the systems analysis phases.

Question 38

When answering questions during a presentation, direct all your attention to the person who asked the question, not the entire group.

Question 39

When considering the cost of a project, personnel costs, such as the salaries of systems analysts, programmers, consultants, data entry personnel, computer operators, secretaries, and the like who work on the project, need to be prorated to reflect the time spent on the projects being estimated.

Question 40

When considering the cost of a project, computer usage and the costs associated with programming, testing, conversion, word processing, maintaining a project dictionary, prototyping, loading new data files, as well as disk storage and printing costs, need to be estimated.

Question 41

When considering the cost of a project, the cost of any new computer equipment and software must be estimated.

Question 42

The following categories of costs need to be considered during cost-benefit analysis: personnel; computer usage; training; supply, duplication, and equipment costs; and cost of any new computer equipment and software.

Question 43

Fixed costs occur at regular intervals but at relatively fixed rates, for example: lease payments, software license payments, prorated salaries of personnel.

Question 44

Variable costs occur in proportion to some usage factor, for example: computer usage, supplies, overhead costs.

Question 45

Variable costs occur at regular intervals but at relatively fixed rates, for example: lease payments, software license payments, prorated salaries of personnel.

Question 46

Fixed costs occur in proportion to some usage factor, for example: computer usage, supplies, overhead costs.

Question 47

Intangible benefits are those benefits believed to be difficult or impossible to quantify.

Question 48

Intangible benefits are those that can be easily quantified.

Question 49

Tangible benefits are those benefits believed to be difficult or impossible to quantify.

Question 50

Examples of intangible benefits include: improved customer goodwill; improved employee morale; better service to community; and better decision making.

Question 51

Examples of intangible benefits include: fewer processing errors, increased throughput, decreased response time, elimination of job steps, increased sales, reduced credit losses, reduced expenses.

Question 52

Examples of tangible benefits include: improved customer goodwill; improved employee morale; better service to community; and better decision making.

Question 53

The concept of the time value of money states that a dollar today is worth more than a dollar one year from now.

Question 54

Operating costs tend to recur throughout the lifetime of the system.

Question 55

Payback analysis is a simple and popular technique for determining if and when an investment will pay for itself.

Question 56

Payback analysis determines how much time will lapse before accrued benefits overtake accrued and continuing costs. This period of time is known as the payback period.

Question 57

Payback analysis is a complex and rarely used technique for determining if and when an investment will pay for itself.

Question 58

It is not possible to compute a payback period because it is impossible to estimate current and future costs of a system.

Question 59

The discount rate is a percentage similar to interest rates and is used to determine the present value of a dollar based on an expected percentage of earnings potential.

Question 60

The discount rate for a business is the opportunity cost of being able to invest money in other projects, including the possibility of investing in the stock market or other financial instruments.

Question 61

The present value of a dollar at any time in the future can be calculated by using a formula.

Question 62

It is not possible to calculate the present value of a dollar at any time in the future; it is too complicated of a concept to be expressed as a mathematical formula.

Question 63

Most spreadsheets include built-in functions for calculating present value.

Question 64

The return on investment analysis (ROI) technique compares the lifetime profitability of alternative solutions or projects.

Question 65

The formula for return on investment is: Lifetime ROI = (Estimated lifetime benefits - Estimated lifetime costs) / Estimated lifetime costs

Question 66

The formula for return on investment is: Lifetime ROI = (Estimated lifetime costs - Estimated lifetime benefits) / Estimated lifetime benefits

Question 67

The net present value of an investment alternative is considered the preferred cost-benefit technique by many managers, especially those who have substantial business schooling.

Question 68

The return on investment (ROI) technique is considered the preferred cost-benefit technique by many managers, especially those who have substantial business schooling.

Question 69

The candidate systems matrix documents similarities and differences between candidate systems, however it offers no analysis.

Question 70

The candidate systems matrix documents similarities and differences between candidate systems and provides calculations for rating them.

Question 71

In constructing a candidate systems matrix the analyst should solicit ideas and opinions from persons and organizations that have implemented similar systems.

Question 72

Brainstorming is an effective technique for identifying possible candidate solutions.

Question 73

When writing a system proposal you should include more information for higher-level management.

Question 74

When writing a system proposal you should write in the active voice.

Question 75

In evaluating feasibility, each kind of feasibility should be counted equally in importance.

Question 76

In a feasibility analysis, the cells contain the feasibility assessment notes for each candidate.

Question 77

The feasibility analysis matrix is a tool used to rank candidate systems.

Question 78

The feasibility analysis matrix complements the candidate systems matrix with an analysis and ranking of the candidate systems.

Question 79

The candidate systems matrix complements the feasibility analysis matrix with an analysis and ranking of the candidate systems.

Question 80

The systems proposal is a deliverable that is usually a formal written report or oral presentation intended for system owners and users.